Bitcoin is behaving more and more like a software stock, with its latest correction unfolding alongside a broader software sell-off.
The relationship between Bitcoin and software stocks has strengthened significantly. According to data from ByteTree, Bitcoin’s correlation with the iShares Expanded Tech Software ETF (IGV) is a whopping 0.73 on a rolling 30-day basis. Year to date, IGV is down about 20%, while Bitcoin is down 16%.
IGV focuses on software and services brands such as Microsoft (MSFT), Oracle (ORCL), Salesforce (CRM), Intuit (INTU) and Adobe (ADBE).
While the tech sector appears to be relatively resilient on a broad level – the Nasdaq 100 (QQQ) is only about 4% below its all-time high – software stocks have absorbed much of the selling pressure, while Bitcoin is increasingly trading in line with weaker parts of the market rather than broader indexes.
As for why the software name is taking a hit, the answer is simple: artificial intelligence. Currently, the rapid progress towards full-featured general artificial intelligence (AGI) is considered an existential issue for software.
“There is no doubt that Bitcoin has been caught up in a technical sell-off,” ByteTree said. “At its core, Bitcoin is an internet stock. Software stocks are the latest casualties, and Bitcoin’s price has shown similar performance over the past five years, with a high correlation.”
ByteTree also noted that the average tech bear market lasts about 14 months. Since the current economic downturn began in October, this suggests that stress may continue through much of 2026. However, ByteTree noted that a resilient economic backdrop could provide support for Bitcoin.
“Bitcoin is just open source software,” said Van Eck’s Matthew Sigel.